What's Going on with IRS Funding?

[music]

Brian Lehrer: It's The Brian Lehrer Show on WNYC. Good morning, everyone. Coming up this morning we'll continue our oral history series on the most defining news events of your lifetime, decade by decade. We're up to callers in your 30s. That'll be around 11:30 this morning. We also, in that series, are taking your most memorable concert so far in your life. Think if you have one of those, again, around 11:30.

Also, in our second hour, we'll take your calls and talk to the Nassau County Executive on Governor Hochul state of the state address proposal to require more home building, more density, especially around train stations in the suburbs. She called out Nassau and Suffolk County, Westchester, and Putnam Counties. I think she left out Rockland for some reason.

We're going to have the Nassau County Executive Republican Bruce Blakeman to see if he's down with this or not. We will take your calls from the suburbs of New York City. Of course, it's really just those in New York State. It's not the New Jersey suburbs because Governor Hochul doesn't have jurisdiction over New Jersey suburbs, but two very interesting segments coming up there. First, fresh off the chaos of choosing a speaker of the House.

House Republicans are getting down to business. How? By attempting to slash funding for the IRS, I can hear tax cheats salivating all over America from coast to coast. It is not a pretty sound. On Monday, in one of their very first legislative actions, House Republicans voted to rescind nearly $80 billion that had been appropriated for the IRS. That was a new $80 billion by last year's Congress. The funding was part of the Inflation Reduction Act and was meant to help the agency hire more people and overhaul outdated technology.

Republicans have claimed that the money would be used to hire auditors that would go after who? The middle class. The Congressional Budget Office, however, estimates that rescinding the funding would add $114 billion to the federal deficit by 2032. That's because they'd spend less on the IRS but also collect less of the tax than Americans owe. The bill did already pass the House, they've passed something.

It's only January 12th, 221 to 210, which means strictly along party lines. Now, with the Democratic majority in the Senate and President Biden barring to veto the bill if it were ever to make it to his desk, doesn't have much of a chance of becoming law, but it does represent the start, not the end, of a Republican attack on the IRS. House Republicans might even vote on something they call the Fair Tax Act. Have you heard about this yet?

It would abolish the IRS and the federal income tax, a vote expected on that at some point. With us now, Catherine Rampell, opinion columnist at the Washington Post, economic and political commentator for CNN, a special commentator for the PBS NewsHour, and a contributor to marketplace here on Public Radio, to explain why Republicans are trying to rescind IRS funding, what that additional funding is for and what might happen if they succeed.

Her latest Washington Post column, maybe some of you saw it, is called First Order of Business for the GOP House, Defunding the Police. Oh, but she's got the word tax in there in parenthesis, so it's defunding the tax police. Always good to have you on, Catherine, welcome back to WNYC.

Catherine Rampell: Great to join you.

Brian Lehrer: Why do you call this defunding the police?

Catherine Rampell: What this is about is making it harder to collect the taxes that are legally owed. Every year there are people who avoid paying their taxes or evade paying their taxes, avoidance is legal, evasion is not legal, but as a result, there is a large tax gap, meaning the difference between what is legally owed and what is actually collected. It is up to the IRS to try to bridge that gap and make sure that tax sheets pay their actual liabilities so that the rest of us don't have to make up the difference, although those of us who do abide by the law don't have to make up the difference by paying higher tax rates over time.

As a result of all of this, as you pushed out just now, when you give a dollar to the IRS, that results in actually higher tax revenues so there's a huge return on investment. There are different estimates, but for every additional dollar that's funded for the IRS, Uncle Sam collects an additional $7 or so. These are the tax cops, that's what it's about. They are there to enforce the tax law essentially and make sure that Uncle Sam gets what is legally owed.

Brian Lehrer: We'll get into the politics of this as we go, but the Republicans argue that they're acting so the middle class doesn't get picked on. Do they have a valid point in saying that the IRS audits the middle class and people with lower incomes more than it does the wealthy?

Catherine Rampell: The people with the highest audit rates remain the very wealthy. However, the audit rates for that group have declined a lot over time. If you look at historical data, going back about a decade or so, if you were a millionaire, you had about like a 12% chance of getting audited by an IRS agent. Today, it's about a 1% chance. Basically, as the IRS has lost funding and it has lost a ton of funding basically since the Tea Party revolution in 2010, as the IRS has lost funding, it has scaled back its enforcement particularly on the ultra-wealthy and big corporations as well, those with whatever it is, I think, the threshold is something like $20 billion of assets.

They have also had their audit rates go down and remember these are the taxpayers who can afford to hire armies, accountants, and tax attorneys who have historically outgun to the IRS as what, anyway, but now the IRS isn't even bothering to try to make sure that they're abiding by the law. It is true, however, that there is a group of lower-income taxpayers who do have unusually high audit rates, and that's people who claim the earned income tax credit.

This is essentially a safety net program that rewards lower-wage earners for working. It tops up their wages, if that makes sense. The IRS does have very high audit rates of that group, not quite as high as that for millionaires, but it is usually

[crosstalk]

Brian Lehrer: Why? Why would that be, because those are, as you point out, among the lowest-income earners in America.

Catherine Rampell: Because it's low-hanging fruit. If the well-heeled have armies of accountants and attorneys to help them, those claiming the EITC tend to be a little bit less sophisticated about the tax code. There are people who improperly claim it, whether deliberately or not, we don't know. The breakdown of that is unclear. There are mistakes that are made at the very least among EITC claimants. This is low-hanging fruit for the IRS.

Generally, when they conduct these audits, these are called correspondence audits where they just send out a letter to the people rather than devoting a full-time IRS auditor agent special, there are different categories of enforcement people but anyway, rather than devoting a human to conduct this audit, they send out a letter saying, we need some further documentation. If you don't reply, then they might just disallow the claim.

I do think it's unfortunate that the IRS does have such high audit rates of the little people. Part of the reason they've done that though is because it requires so few resources on the IRS's part, and they have many fewer resources in general as a result of these funding cuts. They've shifted their focus more towards EIPC claimants and away from those who represent potentially a big payday for the IRS because it requires a lot more effort from the IRS to go after the Donald Trump's of the world, for example, because they're well resourced and can fight back.

Brian Lehrer: Listeners, we can take your phone calls for Washington Post economic columnist, Catherine Rampell, or maybe you see her on PBS or hear her right here on WNYC, on the Public Radio show marketplace. Anything you always wanted to ask Catherine Rampell about the economy but didn't have the opportunity? 212-433-WNYC, 212-433-9692, or tweet a question @BrianLehrer, primarily, on this first action of the New Republican House of Representatives to defund the IRS.

We could also get into some other things. There's a new inflation number out this morning, 6.5% annual rate of inflation last month. Little better, not that much better. What does it mean? 212-433-9692, Or tweet @BrianLehrer. Catherine, on this complexity of auditing a lot of rich people's tax returns and how they don't have the resources to do that adequately.

Is it relevant what we learned from the recent release of Donald Trump's taxes, that they didn't audit him at all during his first two years as president, even though that's the custom, and I think the law that presidents get audited when they're in office because I've seen some reporting that suggested the reason they didn't even do it is because they looked at the complexity of Trump's tax returns, obviously, a rich guy with a lot of different businesses? Is it relevant to this larger discussion about IRS policy and funding or is that just the Trump particular thing?

Catherine Rampell: I think it's both, in that, yes, when people have very complicated tax returns, and they are complicated, often by design to make it easier for them to minimize their tax liability and to make it more opaque in terms of what they are doing to minimize their tax liability. Yes, those are the most challenging things for the IRS to audit. They have lost a lot of their specialists over time, who are qualified to do those kinds of audits, both as a result of the workforce of the IRS aging, and not being replaced and those funding cuts, which, of course, make it more difficult to replace people who have been lost through attrition.

It is the case that the IRS has pulled back some of its enforcement power on these kinds of taxpayers. On the other hand, Trump is an unusual example here because not only were there a lot of red flags about his, let's call it, aggressive tax behavior over the years, including things that he openly boasted about, that he used the tax code to his maximum advantage, besides the fact that they should have been auditing him for those reasons, and had been some of his previous tax returns are still under audit, prior to his taking the presidency.

As you point out, the IRS's own policy is to audit the sitting president and vice president every year while they are in office. For some reason, they, at the very least, dragged their feet in doing so. I don't think it's likely that that's because of resource constraints. I'm sure that it didn't help. I think there's something else strange going on there and we don't know what it is. Like I said, their policy is to audit the sitting president, even when there aren't red flags. Basically, since the post-Watergate era, this was a policy of the IRS so that Americans could be confident that their president wasn't acting as if he were above the law.

Brian Lehrer: Just transparency for those in power, the individual at the height of power.

Catherine Rampell: Right. We don't know what happened there. We don't know if there was some political interference if the IRS was scared of its own shadow. Maybe nobody leaned on them but they were too tentative for other reasons. I don't know. I do think that that merits more investigation why the IRS didn't uphold its own policy. I don't know that that's exclusively about resources.

Although if you look at the reports that came out of the House Ways and Means and House Joint Tax Committee, at the end of December about all of this, they did say that the IRS, for some reason, didn't put a specialist on the returns. They only had initially one employee looking at them. This is a monster of a return, it's now people can see because it's been released. We don't really know what happened there.

For some reason, then democratically controlled committees did not release the internal IRS papers, that would have given us a little bit more insight into how they went about all of this. I was expecting them to they didn't. That's a whole other can of worms. In any event, more broadly speaking, I do think it is the case that the IRS needs more resources. One thing we haven't talked about is that the funding that was appropriated to the agency as part of the Inflation Reduction Act was not only for enforcement.

I don't know if you want to get into this. About half of it that the $80 billion was for enforcement. The rest of it went toward a lot of other things like upgrading the agencies IT which is abysmal, and I had a lovely tour of its archaic disco era IT last year which I'm going to be talking about, and customer service. As anyone who has tried to call the IRS knows, it is an infuriating process. You can be on hold for ages and never actually speak to anyone and this is for people who are trying to abide by the law.

If the IRS wants to collect more money, money that is legally owed, they can do it both through enforcement. This is basically involuntary compliance, and voluntary compliance, people who want to abide by the law but are struggling to do so because the tax code is really confusing because somebody stole their identity and false tax return on their behalf, et cetera. There are a lot of people who are trying to abide by the law who are doing their best, but the IRS has failed them by providing terrible, terrible customer service and some of this money would go towards improving that so that those of us who are honest taxpayers can be so.

Brian Lehrer: For those of you who think that reading a Catherine Rampell column about IT at the IRS would be technocratic and boring, you should read that column, because it was mind-blowing how you described how a lot of the work is done by hand in an assembly line process. When you would think in 2023 rather than what you call disco-era technology, they would be doing it with advanced algorithms and this stuff would get done quickly and efficiently. Are you ready to suffer some slings and arrows of pushback-

Catherine Rampell: Sure.

Brian Lehrer: -from people who do think that the IRS should be defunded and our lines are full at 212-433-WNYC for Washington Post columnist, Catherine Rampell. David in Howell New Jersey, you're on WNYC. Hey, David, thanks for calling in. David, are you there? Did David get cold feet? Maybe he did but never fear I have another call pushing back. Lou in Queens, you're on WNYC. Lou, are you there?

Lou: Yes, I'm here.

Brian Lehrer: There we go. Hi, Lou.

Lou: I don't think that they should increase the funding for the IRS but for a different reason than the politicians to. I have to tell you I guess that she's a victim of the IRS scam. The IRS compliance area scam is the greatest scam in this country's history because of the amount of money that is lost. IRS revenue agents, for the most part, don't do audits. There's a quota system where the only thing that matters is the number of cases that get closed.

The managers get their bonuses based upon making the quota. Managers tell their personnel that Congress assigns the quota. It's called the exam plan. All the revenue agent has to do is go out meet with a taxpayer once and close the case, is an expression that revenue agent choose called T&E and out by three. You look at travel and entertainment expense, make a little adjustment there then close the case. It makes your life really easy.

Brian Lehrer: Lou, thank you very much for that. Catherine, is he saying anything you've ever heard before?

Catherine Rampell: I've heard that there are issues with the incentives or at least how the IRS gauges success in terms of meeting its targets. It's not about collecting the most revenue, it's about-- What I've heard is, it's about maximizing compliance which is a fuzzy concept as opposed to making sure that they get the most revenue. I haven't exactly heard the version of events that this caller talks about. It could be correct.

I would argue that if you think that the IRS has mismanaged, fix the mismanagement issue. They absolutely do need more resources, and they need to make sure that they are managing their resources so that they are maximizing compliance at the high end where, again, it's the biggest dollar value. It requires the biggest upfront investment because it requires getting these specialist agents up to speed and poring over these very complex tax returns of whether it's a former president or otherwise.

People who are well-heeled and have a lot of resources to do a lot of aggressive tax planning, I'll put it that way, as opposed to focusing the resources on EITC claimants, for example, but it's fair to say that there are two issues here. One is, what dollars the IRS has, and then the other is how they deploy them. I'm sure that however they're deploying the dollars that they have today is not optimal but I haven't heard those precise complaints that the caller has spoken about so I can't comment on them directly.

Brian Lehrer: Nancy in Otis, Massachusetts, in the beautiful heart of the Berkshires. Nancy, you're on WNYC with Catherine Rampell. Hi, Nancy.

Nancy: Hi, Brian. On my second favorite NYC program On the Media. Every year they rebroadcast a program about the IRS.

Brian Lehrer: It's okay you could say that On the Media is your favorite program. It's okay but anyway, I'm kidding go ahead.

Nancy: No, Brian Lehrer is definitely my favorite program.

[laughter]

Every year, as a public service, they rebroadcast a program about the IRS and within that program, they tell you how to access the free file taxes. Within the program, they talk about how other countries, instead of having their residents fill out tax forms, they either simply send out a bill or a check. Could our tax system be simplified in that manner and then, hopefully, save the kind of money the Republicans are saying they are trying to preserve?

Brian Lehrer: Catherine?

Catherine Rampell: Theoretically, yes, I think that would be a great improvement. If, instead of taxpayers having to waste tons of hours and money, if you're paying for a professional tax preparer, getting your tax returns in order that the government just sent you a bill saying, "Look, we have enough information, internally. Your employer tells us how much you earn when they remit payroll taxes. We can fairly estimate what it is the typical taxpayer owes if you're just a regular W-2 wage earner." Yes, that'd be great.

Unfortunately, Congress has not shown interest in doing that and it would require a major simplification of our tax code because our tax code is unbelievably complex. Even if you are, let's say, a typical wage earner or the government knows how much money you've been making, through your salary through your hourly wages, whatever, people might have self-employment income, they have all sorts of deductions that they might want to take.

For example, if they own a house, the home mortgage interest deduction, and then how does that square off against the standard deduction. Our tax code is so complex, that it would require a major overhaul to simplify it, and then it would obviously require an investment in administrative resources on the government side to produce those tax calculations for you. I'm just not hopeful that either of those things is going to happen, although it'd be great if it did.

Brian Lehrer: We have an interesting follow-up tweet for that but before I let Nancy go, Nancy, I'm curious since you're calling from Otis. Have you had snow up there in the Berkshires yet this winter? We got a tweet this morning as the show was starting from a listener unrelated to anything about the IRS or taxes or the economy but related to the climate listener tweets, "New York City has gone 308 straight days without any measurable snowfall. Seven of the city's top 10 all-time snow droughts have come in the last 24 or 25 years. Hashtag climate crisis." I'm just curious since you're up in the mountains there but not too far geographically from New York City. Have you gotten snow in the mountains this winter yet?

Nancy: We had snow the week before Christmas and it literally stayed in the trees about the longest I've ever seen so was that cold but then when we had that [unintelligible 00:24:13] last week, I think that's when they hit in the '50s, then just the ski mountains just they couldn't keep up with the snowmaking. The trails were pretty clear of snow but now this week again, it got cold, and right now I'm looking at snow as I look out the window and the snow-making machines have been going all night and all day and I think they're going to be ready to ski this weekend.

Brian Lehrer: All right. Good report for the skiers in the audience and to know at least it gets cold enough in the Berkshire mountains to still snow in January, if not in New York City. Nancy, thanks so much for your call. Here's the follow-up tweet that I had in mind because you were talking about the complexity of the tax code the tax system listener writes, "Wouldn't a VAT," value added tax on your purchases, "with rebates to lower tier earners be easier to police than just an income tax, and the $30 trillion debt divided by the number of person-years it took to build it to 2600, et cetera. In other words, to boil that down, wouldn't a value-added tax on money that we spend with rebates to lower-tier earners to make it a progressive tax be easier to police than our current income tax system?"

Catherine Rampell: In many ways, yes. Well, it depends on how the system is structured but in some country, most countries in the world, I should say, do have a value-added tax of some kind. We have other kinds of consumption taxes, like state-level and local-level sales taxes, but most other countries have a national value-added tax, and they can be structured so that they are self-reinforcing so that if I am a company that makes, what's a good example, I don't know, I make toys. The value-added tax that I pay depends on what the supplier who sells me the components, what they paid.

It's like, it's self-reinforcing, in that, I want to get documentation from the upstream guys to make sure that they pay their tax so that I pay less tax, If they paid $10 per unit of, let's call it, wood blocks or something and the price of the thing that I'm making is $20, I want to get credit for the $10 that they already paid. In that sense, it can be self-reinforcing. It doesn't require as much government-level enforcement but you do obviously lose a lot of other policy tools when you switch to a value-added tax. Part of the reason why our tax code is so complex is that we're trying to get it to do a lot of different things.

We're trying to get it to subsidize investments in research and development. We are trying to use it to encourage people to work, to encourage people to have kids or to defray the cost of having kids. We are trying to use it to encourage homeownership. All of these kinds of incentives and safety net programs that are built into the tax code are part of what makes it much more complex because it's trying to do so many things but you also lose the ability to do those very many things. It depends on what your preferences are about how the tax code should work.

I do think it's an important point to emphasize that if you switched entirely to a value-added tax system, it would be regressive in the sense that lower-income people spend a higher share of what they earn than higher-income people do. The listener's comment about rebaiting back some of the money to the lower income people I think would be a very important element of all of us but yes, there are a lot of people who like a value-added tax because of its elegance, because if it's self-enforcing aspects, and because it would be a lot simpler, but you lose other functions.

Brian Lehrer: We'll continue in a minute with economics colonists, Catherine Rampell. Will get into the politics of it, which we really haven't done why is the first thing the Republican House is doing, trying to defund the IRS or as she puts it, in her Washington Post column headline, defund the tax police. Catherine, I will ask you to put the new inflation number out this morning at an annual rate of 6.5%, a little bit of an improvement into some context, and we'll take more of your calls. Stay with us.

[music]

Brian Lehrer on WNYC with Catherine Rampell, opinion columnist for the Washington Post, economic and political commentator for CNN, special commentator for PBS NewsHour, and a contributor to the public radio program marketplace, as we talked about the first thing policy-wise that the Republicans did with their new House majority and that is vote to remove $80 billion from the IRS. I'm going to try David and Howell New Jersey again. Who wants to push back on your comments, Catherine, David, you're on WNYC. I think we have you now. Hi there.

David: How are you doing? You hear me?

Brian Lehrer: Good. Yes.

David: Okay. I think whenever I listen to your show, when you speak about anything, republicans say that you are the king of saying without any evidence. It's like Trump said this, the Republican without any evidence.

Brian Lehrer: Only when it's without any evidence. David, you want to go onto the topic?

David: Yes. This has become a narrative of constantly saying the IRS needs more things. People aren't paying their taxes. Well, that's just said without any evidence. Most people shutter and shake from the IRS and they're so scared of their tax returns, as I do that, of course, everyone pays their taxes and it's just without any evidence, it became a narrative. Now, to answer your other question, why this has been the Republican's first thing is, because this has been anything that can bash Americans and say, Americans are terrible. They don't pay taxes. The middle class is terrible. They don't pay taxes. That takes priority for the Democrats. That's why they made it their first priority.

Brian Lehrer: David, thank you. We'll get you an answer. Appreciate your call. Do call us again. Catherine, it's a fair question to ask for the evidence that a lot of people are tax cheats. David is surmising that almost nobody is a tax cheat because they're afraid of the IRS.

Catherine Rampell: We actually do have a fair amount of evidence on this because the IRS does some of these randomly assigned audits to try to figure out where are they like if-- Rather than using some other algorithm to figure out who to audit, they say, let's do a cross sample to figure out if we audit in more of this tax income group, for example, or this taxpayer, how much money would we collect, et cetera.

I will say, overall, Americans are actually quite compliant when it comes to their taxes relative to a lot of other developed countries. If you go to someplace like Italy or Greece, tax compliance is much lower. It is true that most Americans regard paying their taxes as their civic duty, they are honest taxpayers. They do abide by the law, whether because they're afraid of the IRS or otherwise. Maybe it's just patriotism, I don't know.

Most people are honest taxpayers, but not everyone is. [chuckles] There are a lot of people who have a lot of resources who can make it easier, who can use those resources to make it easier to essentially cheat Uncle Sam and place more of the tax burden on those of us who are honest, including our caller David from New Jersey. There are people who cheat. Surprise, surprise there are people who cheat, in fact, they get prosecuted for cheating. Although you can see that over time, the number of Americans who have been prosecuted as a result of referrals from the IRS has declined.

Not presumably because there's more compliance, but because the IRS just doesn't have the enforcement capacity to do those audits to catch people. We do have a fair amount of evidence that there are tax sheets out there. We know that they're concentrated, in particular, kinds of taxpayers, maybe taxpayers who have less third party reporting to the government. Like I said, if you are a regular W2 employee and you have no other source of income, it's very hard to cheat on your taxes, because your employer is telling the government how much you owe.

For a lot of other people who have-- They run a business, for example, they might be able to take a lot of dodgy deductions that are relatively non-transparent. Again, you can look at Donald Trump's tax returns and he is a case in point. He's an outlier, I would say because he has this huge sprawling complex empire and works in real estate, which is an unusually labyrinthine part of the tax code.

You can see, he has these deductions on his tax returns that we don't know what they are or what they're for and there's no third-party reporting that would enable the IRS to tell whether that is a valid deduction or not. There are things you look at his tax returns just as a case in point because, again, we have them. You can see that his wife, Melania, had, I forget what the number was, but it was like $38,232 in income from modeling and 38,000 whatever I just said, $232 in expenses, unnamed expenses, [laughs] exactly the same, whatever it was, whatever the actual number was.

Brian Lehrer: That was for the cost of one dress. Anyway, go ahead.

Catherine Rampell: We don't know what it is. Something like that, it's very hard for the IRS to know were those valid deductions or were those at valid expenses, I should say or not without doing an audit. I don't want to presume that they were illegal that she crossed the line, but that's the thing that the IRS would not know. If you are getting your income this way through these relatively convoluted means, and you have these convoluted deductions, you might be more embolden to cheat because the IRS doesn't have a way of matching it up with other documentation.

Brian Lehrer: On the politics of why they are doing this and doing this first, one listener tweets, GOP's IRS policy is entirely about minimizing tax on the wealthy, which implies that it's the wealthy that's their constituency and they're looking to protect their constituency. Maybe that's wrong or maybe there are other reasons. Why is this so high on the Republican's agenda?

Catherine Rampell: I do think that they prioritize tax cuts for the wealthy in corporations. I think they've actually been pretty open about that over the years. You look at what they did when they had unified control of government. Their first, or not their first order of business, but their arguably biggest legislative achievement was a major tax cut that the tax cuts and jobs act that was weighted toward the wealthy and corporations.

I also think that because there's so much confusion about how the IRS works and whom the IRS would go after if they were given more resources, would they go after the middle class, for example? Just as we've heard from some of our callers' people who don't trust that the IRS is going to deploy those additional resources to go after the deep-pocketed, real estate Barron's of the world.

I think that it is a useful rhetorical position for Republicans to hold to say, we are protecting you, the little guy, the honest middle-class taxpayer who's already afraid of the tax cops and who's abiding by the law. We're protecting you from IRS agents who want to harass you even though you are doing everything honestly and legally. I think it is a useful boogeyman.

Like I said, it's not totally unmerited to be concerned that the IRS would not use those resources against the very top of the income distribution or the biggest corporations because of some past things they've done, including deploying a lot of auditing resources. Well, relatively few, but in terms of quantity of people getting auditing a lot of EITC climates. I think there's a kernel of truth to that. I think it's partly there are actual policy objectives and partly just about political posturing.

Brian Lehrer: Last question before you go, 6.5% inflation rate and the new numbers just released for last month. Little bit of an improvement from what we saw during 2022. What does it mean?

Catherine Rampell: I think this is very good news. The Federal Reserve has been doing its darnedest to get inflation rates down without provoking a recession. That is a very difficult set of objectives to meet it once, historically, when they have raised interest rates to dampen inflation, they have accidentally caused a recession. The fact that inflation has been moderating, it's still too high, don't get me wrong.

It's still very much too high. The fact that it seems to have peaked, things seem to be getting better without causing any major pain in the labor market, I think is a very good sign. As listeners probably recall, we just got this job report about a week ago, a little less than a week ago, that was quite good. It showed continued job growth, it showed the unemployment rate again fell.

The fact that we have these two reports together, inflation moderating the job market continuing to seem relatively strong, I think is a really good sign. I hope it continues. I don't think the risk of a recession is completely ruled out, but I am more optimistic today than I was a few months ago that we will get to that so-called soft landing where we can get inflation out of our system without causing a major spike in employment

Brian Lehrer: That rarest of commodities these days, optimism from Catherine Rampell, maybe you've seen on CNN or the PBS NewsHour or heard her on Marketplace and she's a Washington Post columnist whose latest column is, first order of business for the GOP House, defunding the tax police. Catherine, thanks as always, really appreciate it.

Catherine Rampell: Thanks, Brian.

 

Copyright © 2023 New York Public Radio. All rights reserved. Visit our website terms of use at www.wnyc.org for further information.

New York Public Radio transcripts are created on a rush deadline, often by contractors. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of New York Public Radio’s programming is the audio record.